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NICS voluntary exit scheme

Permanent personnel within the Northern Ireland Civil Service have been offered an opportunity to apply for voluntary redundancy packages.

A one-year voluntary exit scheme to reduce the Civil Service’s headcount by around 2,400 posts has been launched in an effort to save almost £90 million from the annual pay bill. The strategy emerged from the Stormont House Agreement. Currently, the Civil Service employs around 27,500 staff across all departments, equating to almost 13 per cent of the public sector.

Applications to the scheme ran over four full working weeks in March and successful applicants are expected to be informed in June. Within two hours of the scheme’s launch, 730 civil servants reportedly registered their interest and within a week that figure had exceeded 3,200. The first quota of eligible staff will leave in September this year while the final tranche will do so by the end of March 2016, subject to available resources. The scheme is open to almost all permanent staff. However, it is expected that a value-for-money formula will be applied whereby civil servants with less experience are likely to be granted access to the scheme ahead of those with larger compensation packages.

The process is expected to yield savings of approximately £26 million in 2015-2016 and an estimated £88 million each year subsequently. Meanwhile, compensation payments are expected to average between £48,000 and £50,000 across the 2,400 available redundancy packages. Funding for the scheme will be sourced from an additional £700 million of capital borrowing and spending agreed as part of the Stormont House Agreement. Colin Lewis, Director of Corporate HR at the Department of Finance and Personnel, has outlined:

“If I were able to get everything that I want, we estimate that the compensation cost required would be in the range of £98 million to £130 million.”

The key details of redundancy payments are as follows:

• compensation will be awarded on the basis of one month’s pay per year of service up to a maximum of 21 months;

• an online compensation calculator is available to civil servants;

• the minimum salary boundary on which payments will be based is £24,728 while the maximum salary used to calculate payments will be £100,091;

• staff earning below the maximum of the ‘executive officer 2’ pay scale will have their compensation calculated using the top-end of that grade (£24,728);

• staff over normal scheme pension age will have their compensation capped at six months’ pay; and

• the first £30,000 of individual compensation awards will be tax-free.

Addressing MLAs before the unveiling of the scheme, Colin Lewis stated: “It would be foolish and probably naïve to think that, when you are seeking to exit nearly 13 per cent of the Civil Service in little under a year and a half, it is not going to have some effect.” In order to protect service delivery, redeployment of staff and resources will be necessary to ensure that essential posts left vacant by the scheme will be filled.

The scheme has been adopted alongside other strategic measures which were introduced last November. These included a service-wide recruitment freeze and an embargo on substantive promotions. Speaking at its launch, Finance Minister Simon Hamilton commented: “The scope and speed of this voluntary exit scheme is unprecedented in the history of the Northern Ireland Civil Service.” He added: “It is important to emphasise that this one-year scheme is entirely voluntary and not part of a process that will lead to compulsory redundancy.